What to Note When Signing Labour Contract with Foreign Workers?

 With the policy of opening the economy in Vietnam, not only Vietnam attracts investors to set up company, but also the demand for foreign workers in enterprises grows and diversifies. However, in order for Vietnam companies to be able to use foreign workers, they must sign a labor contract.

After meeting the conditions specified in the Labor Code on meeting the requirements for recruitment and working in Vietnam, the foreign worker working in Vietnam shall sign a labor contract before the expected date intend to work for the employer. In this contract, the employer and the foreign worker will agree on all issues arising in the process of working as well as using labor together.

Firstly, on the working position in the labor contract, it must show the correct position and position for which the employer has determined the needs with the competent authority and in accordance with the working position shown in the document and the work permits which have been granted to foreign workers.

Regarding the working time, it will normally be agreed upon by the two parties but must not exceed the number of working days (hours) as prescribed by Vietnamese law. The number of overtime hours must be based on voluntary work and must ensure rest time, rest during working time and weekends for foreign workers.

According to the provisions of the Labor Code, in addition to Vietnamese public holidays and New Year’s holidays, foreign workers are allowed to take one more day off for the national traditional New Year and one national day of the country. This is a humane regulation, respecting the national culture of Vietnam. Therefore, the employer needs to learn about the National Day and the traditional Tet holiday of foreign workers so that the employees can take leave in accordance with the provisions of the law.

Regarding the term of the labor contract, the term of the labor contract for foreigners is also governed by the duration of the work permit issued by the competent Vietnamese authority. Accordingly, the term of the labor contract for foreign workers working in Vietnam must not exceed the term of the work permit. Therefore, the employer should pay attention to conclude the contract term in accordance with regulations.

In addition, employers and foreign workers should be aware of the terms of disputes which could potentially arise. Because, contract terms are an important legal basis to resolve when a labor dispute arises, agreeing in advance on how to resolve a dispute when a dispute arises will create a clear legal foundation for easy settlement by both parties. Dispute lawyers are suggested to be consulted at an early stage to avoid dispute escalation.

At most, it is important that the employers and foreign workers need to pay attention and strictly comply with the provisions of the law so that the process of entering into and performing the contract is conducted smoothly and in compliance with the law in Vietnam.

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What to Note When Signing Labour Contract with Foreign Workers?

  With the policy of opening the economy in Vietnam, not only Vietnam attracts investors to set up company, but also the demand for foreign workers in enterprises grows and diversifies. However, in order for Vietnam companies to be able to use foreign workers, they must sign a labor contract.

After meeting the conditions specified in the Labor Code on meeting the requirements for recruitment and working in Vietnam, the foreign worker working in Vietnam shall sign a labor contract before the expected date intend to work for the employer. In this contract, the employer and the foreign worker will agree on all issues arising in the process of working as well as using labor together.

Firstly, on the working position in the labor contract, it must show the correct position and position for which the employer has determined the needs with the competent authority and in accordance with the working position shown in the document and the work permits which have been granted to foreign workers.

Regarding the working time, it will normally be agreed upon by the two parties but must not exceed the number of working days (hours) as prescribed by Vietnamese law. The number of overtime hours must be based on voluntary work and must ensure rest time, rest during working time and weekends for foreign workers.

According to the provisions of the Labor Code, in addition to Vietnamese public holidays and New Year’s holidays, foreign workers are allowed to take one more day off for the national traditional New Year and one national day of the country. This is a humane regulation, respecting the national culture of Vietnam. Therefore, the employer needs to learn about the National Day and the traditional Tet holiday of foreign workers so that the employees can take leave in accordance with the provisions of the law.

Regarding the term of the labor contract, the term of the labor contract for foreigners is also governed by the duration of the work permit issued by the competent Vietnamese authority. Accordingly, the term of the labor contract for foreign workers working in Vietnam must not exceed the term of the work permit. Therefore, the employer should pay attention to conclude the contract term in accordance with regulations.

In addition, employers and foreign workers should be aware of the terms of disputes which could potentially arise. Because, contract terms are an important legal basis to resolve when a labor dispute arises, agreeing in advance on how to resolve a dispute when a dispute arises will create a clear legal foundation for easy settlement by both parties. Dispute lawyers are suggested to be consulted at an early stage to avoid dispute escalation.

At most, it is important that the employers and foreign workers need to pay attention and strictly comply with the provisions of the law so that the process of entering into and performing the contract is conducted smoothly and in compliance with the law in Vietnam.

Read More

What to Note When Signing Labour Contract with Foreign Workers?

 With the policy of opening the economy in Vietnam, not only Vietnam attracts investors to set up company, but also the demand for foreign workers in enterprises grows and diversifies. However, in order for Vietnam companies to be able to use foreign workers, they must sign a labor contract.

After meeting the conditions specified in the Labor Code on meeting the requirements for recruitment and working in Vietnam, the foreign worker working in Vietnam shall sign a labor contract before the expected date intend to work for the employer. In this contract, the employer and the foreign worker will agree on all issues arising in the process of working as well as using labor together.

Firstly, on the working position in the labor contract, it must show the correct position and position for which the employer has determined the needs with the competent authority and in accordance with the working position shown in the document and the work permits which have been granted to foreign workers.

Regarding the working time, it will normally be agreed upon by the two parties but must not exceed the number of working days (hours) as prescribed by Vietnamese law. The number of overtime hours must be based on voluntary work and must ensure rest time, rest during working time and weekends for foreign workers.

According to the provisions of the Labor Code, in addition to Vietnamese public holidays and New Year’s holidays, foreign workers are allowed to take one more day off for the national traditional New Year and one national day of the country. This is a humane regulation, respecting the national culture of Vietnam. Therefore, the employer needs to learn about the National Day and the traditional Tet holiday of foreign workers so that the employees can take leave in accordance with the provisions of the law.

Regarding the term of the labor contract, the term of the labor contract for foreigners is also governed by the duration of the work permit issued by the competent Vietnamese authority. Accordingly, the term of the labor contract for foreign workers working in Vietnam must not exceed the term of the work permit. Therefore, the employer should pay attention to conclude the contract term in accordance with regulations.

In addition, employers and foreign workers should be aware of the terms of disputes which could potentially arise. Because, contract terms are an important legal basis to resolve when a labor dispute arises, agreeing in advance on how to resolve a dispute when a dispute arises will create a clear legal foundation for easy settlement by both parties. Dispute lawyers are suggested to be consulted at an early stage to avoid dispute escalation.

At most, it is important that the employers and foreign workers need to pay attention and strictly comply with the provisions of the law so that the process of entering into and performing the contract is conducted smoothly and in compliance with the law in Vietnam.

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When Should the Employer Send Notice of Termination of Labour Contract to Employee Before Contract Expiration?

  

Expiration is one of the circumstances which permit termination of labor contract under the Labor Code 2012. Accordingly, the employer must inform in writing to the employee of the terminating date of labor contract at least 15 days prior to the expiration. Termination of labor relationship in each circumstance must follow different conditions and procedures to ensure the interests and obligations of both employee and employer and avoid potential labor disputes.

Previously, an administrative penalty was applied to violations of the labor contract termination notice mentioned above. If the employer fails to inform the employee, the employer will be subject to a warning or a fine with amount from VND 500,000 to VND 1,000,000. However, the Decree 28/2020/ND-CP issued on March 1st, 2020 by the Government has repealed sanction for this behavior.

If the employee continues to work upon expiration of labor contract, both parties will be required to sign a new labor contract within the next 30 days, otherwise the signed contract will become an indefinite-term. Failure of the employer to inform the labor contract termination to the employee does not mean that the labor relationship is automatically extended after the expiration. If both parties fail to sign a new labor contract within the next 30 days, but the employee still do normal assigned job and is paid a full monthly salary, an indefinite-term labor contract is deemed as entered into by them. Any disputes arising out then will be settled based on provisions of indefinite term labor contract and laws.

The Labor Code 2019 repealed the employer’s informing responsibility upon expiration of labor contract except in a few circumstances such as the employee being sentenced to imprisonment, disciplined, expelled, …, the employer is required to inform the employee in writing the termination of the labor contract.

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Can Employer Terminate the Labor Contract with Employee Due To Covid 19 Outbreak

 Due to intricate occurrence of Covid 19, many enterprises are forced themselves to reduce the number of employees for maintaining the operation financially. Specifically, the employer has to make difficult decision to terminate the labor contract with the employee. The termination of the labour contract has to be considered carefully because of potential legal risks brought up which dispute lawyers in labour should be consulted before execution. Within this post, we are not trying to resolve all cases but only aiming to brief some matters of concern for preparation.

The employer could refer to the regulation in the Labor Code which allows “an employer may unilaterally terminate a labor contract if as a result of natural disaster, fire or another force majeure event as prescribed by law, the employer, though having applied every remedial measure, has to scale down production and cut jobs. Force majeure in this case is understood as (i) Enemy-inflicates destruction, epidemics (ii) Relocation or narrowing of the production and business sites, at the request of competent State agencies.

In particular, after applying corrective measures, over the time, considering enterprise’s financial potential is insufficient as well as the business production is reduced significantly due to epidemic, the employer may consider unilaterally terminate labor contract with employee. However, employer still have to abide by or ensure the rights to employee regarding the interests which employee is entitle to receive when being unilaterally terminated labor contract includes salary, severance allowance, social insurance, payment for untaken leave days, the tax payment which employer must paid for employee. Besides, employer also is subject to pay a compensation if consented by both sides are employer and employee.

Firstly, employer is obliged to pay salary to employee timely and fully as in the agreed labor contract by both parties;

Secondly, employer is responsible for paying the severance allowance to employee whom has worked regularly for full 12 months or longer at the rate of half of a month’s wage for each working year.

Thirdly, social insurance, employer is responsible for the fulfill payment of social insurance and perform the closing insurance book for employee after terminate the labor contract according to the law of social insurance.

Fourthly, if the income of employee subject to personal income tax, employer must extract from the income of employee to submit the tax to tax agency according to law on personal income tax.

If the client needs any other information or requires for further advice, our lawyers at ANT Lawyers in Vietnam will be available for service.

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